Markets in Oceania are dynamic
Not only does Oceania have a mature aviation industry, its overall economy is also mature. Since 2004, the region's economy has grown 2.7 percent annually, and it is expected to continue growing at that rate through 2034. This is slightly below the world trend of 3.1 percent. Australia and New Zealand account for 98 percent of the region's GDP and are expected to hold that share over time. This is helping driving passenger traffic growth of 2.6 percent and air cargo traffic growth of 4.1 percent.
Airlines are continuing to assess their strategies for the markets they serve, weighing whether to serve the market on their own or to partner with other airlines and serve it jointly., Oceania airlines currently provide the most capacity in the region. Middle Eastern airlines, which represent only 4 percent of airline seats in the market, have been growing more than 10 percent annually—the fastest in the region. Currently, seats of Southeast Asian and Chinese airlines account for approximately 15 percent of regional capacity, and the airlines continue to grow 4.5 percent annually.
Low-cost carriers in Oceania are evolving—both with local airlines and with airlines that serve the market from other regions. Just 10 years ago, these carriers flew approximately 9 percent of flights in Oceania; now, their share is more than 20 percent. This trend, coupled with 4.5 percent growth in passenger traffic within Oceania, will drive the need for 730 new single-aisle airplanes, valued at $400 billion.
In long-haul markets, 12 new routes have opened in the past three years, and passenger traffic is estimated to grow 5.3 percent in the next 20 years. This growth, along with replacement demand for more than half of the widebody fleet, will drive the need for 210 new widebody airplanes, valued at $60 billion.